This is a the text of the complaint I sent to several addresses at Iberia on December 08, 2010. They have not done anything about it.

My fiancee and I bought from Iberia the e-tickets and with the following details.
IB 3759 N 13NOV 1655 IST-MAD ARRIVAL TIME: 2010
IB 7303 N 14NOV 0035 MAD-GYE FLIGHT OPERATED BY: LAN AIRLINES ARRIVAL TIME: 0630
IB 7756 N 27NOV 2325 GYE-MAD FLIGHT OPERATED BY: LAN AIRLINES ARRIVAL TIME: 1625
IB 3762 N 28NOV 1810 MAD-IST ARRIVAL TIME: 2305
We arrived at the boarding gate in Madrid at around 17:30 and started waiting for the boarding to begin. When the boarding started some minutes later, we were told that we could not board the flight. When we asked why, the personnel told us that apparently our flight from Guayaquil had arrived late and that our luggage could not be loaded on to the Istanbul flight and that there were not meals for us on the flight. Iberia did not announce our names or try to inform us in any other way until boarding had already started although we were waiting at the gate for some time by then. Iberia representatives at the boarding gate told us that their denying our boarding was not their responsibility and that we should go talk to LAN and let them sort it out. This was a surprise for us because Iberia and LAN are alliance partners, share codes, and therefore delayed luggage should not prevent a passenger from being allower to board the flight.
This meant that we would need to clear immigration and customs at Terminal 4S, go to Terminal 4, get booked on the next flight to Istanbul which was at 11:00 the next day (29.11.2010), go to a hotel without our luggage, come back the next day, clear immigration and customs, take the 11:00 flight and be in Istanbul about 18 hours later than scheduled.
Since we had to be in Istanbul on 29.11.2010 earlier and did not want to lose the whole day, we told the Iberia personnel very reasonably that the luggage could arrive with the next flight and that we accepted to fly without having a meal. In addition to us two, there was a man from Ecuador who was exactly in the same situation and was requesting exactly the same. The personnel accepted that it would be possible and wrote on our boarding passes "acepta volar sin comida", namely that we had accepted to fly without a meal and started processing us. One of the two Iberia personnel, Maria (she would not give her full name and I could not read her name-tag) went inside the plane around this time.
Until then, the conversation was in English, had started in English between my fiancee and the Iberia personnel, had continued in English when the Iberia personnel had addressed me in English and I had replied in English.
As Ms. Maria was in the plane, the other Iberia personnel, Ana Isabel Munoz, realized that I could speak Spanish and rudely asked me why I was speaking English. I was surprised and asked her why it
was a problem. She started complaining about me speaking English even though I was able to speak Spanish and was outright dismissive and rude towards me. I pointed out that she was the person who first spoke to me and that she had done that in English. I also asked her again why she was being so rude towards us just because everyone was speaking a language which everyone understood and when my fiancee and I had acted very properly and politely. Ms. Munoz continued her rude behaviour and she did that in Spanish, not reverting to English ever again. My fiancee intervened to tell her that she speaks very little Spanish and that it was logical that the discussions were made in English so that she could also follow what was going on. Ms. Munoz started shouting and outright insulting us. Our attempts to calm her down and continue with the procedure were in vain.
When the other personnel, Ms. Maria, returned from the plane, Ms. Munoz interrupted her insults to us and turned to her to tell her that we would not board the plane. Since we were very surprised at the behaviour of Ms. Munoz and how the events unfolded, we asked Ms. Maria how we could proceed. Ms. Maria replied in English and said that we could not board the plane. Ms. Munoz never once stopped insulting us and calling us names during this time. When we asked why we could not board, Ms. Maria said that it was so and that we should go to LAN. Ms. Maria did not ask us at all our side of the story, neither did she ask her colleague, neither did she explain what the problem was. When we asked to see the supervisor or someone who could assist us, she told us in Spanish to go to the Iberia office and find him, not once reverting back to English again even when my fiancee was trying to speak to her in English. When I asked her why she did not speak English, both almost at the same time replied "this is Spain and this is Iberia, here we speak Spanish". Ms. Maria ignored us from then on, Ms. Munoz finally stopped insulting us and they left the gate.
My fiancee and I walked over to the Iberia office where we told the gentleman at the counter that we needed to speak to the supervisor and that gentleman pointed to someone at the door of the office. From where we stood, we could see that person sitting inside the office, eating something, sometimes looking at us and sometimes talking to Ms. Maria and Ms. Munoz inside, bad-mouthing and dismissing us in Spanish, using rude and aggressive language about us, that there was no reason that he should even talk to us, apparently unaware that I could understand. Somebody told him that I spoke Spanish and he toned down his words somewhat. When he finally paused, we asked him if we could talk to him. He shouted back to us that there was no reason, that we should treat his personnel better. He ordered us to go to LAN. We repeated politely that we would like to talk to him and asked his name but he shouted back "my name is Jesus" and kept being rude and aggressive towards us and it was clear that he was only interested in what he heard from the personnel and did not want to hear what we had to say. When my fiancee repeated the request, he replied that we should come back half-an-hour later, saying that he did not have time for us. There were no other customers around so it was clear that he was not busy with customers.
My fiancee stayed until Mr. Jesus found the time and explained her the situation. After continuing his rude attitude and not wanting to hear what she had to say, he said that we had insulted his staff. This was not true and after my fiancee explained the situation to him, he finally said that he would speak to the personnel.
In the meantime, I went to LAN and they made the arrangements for us to go to a hotel and take the next flight the next day. Although we had bought the ticket from Iberia, Iberia never took any responsibility and shoved everything upon LAN.
We then spoke to Ms. Miriam Hidalgo and told her about our experience. She was very polite, upset about what we had to through and advised us to contact Iberia customer service. We gave her the names, showed her the documents we had, thanked her and left.
The above sequence of events is not what a passenger expects from any airline and is certainly not a fair treatment. This type of discrimination and rudeness is defintely not normal and acceptable. Iberia's service, operations, and responsibility for the passenger need to be scrutinized and these actions clarified.

Unfortunately, companies which came from state ownership have a higher percentage of personnel who do not feel motivated to serve the customer. In a state owned company it does not matter. I don't believe all Iberia personnel are like that but the processes tend to reflect that carelessness about customers and competitiveness. I am just having a extremely bad service with a missing bag that missed 2 flights and finally arrived last evening. And now it will take 38 hours for it to be delivered to my hotel, just 45 min away. And the Iberia attendant couldn't care less - write a letter!